Invoice Factoring

Invoice factoring, also known as invoice financing or accounts receivable financing, is a simple and flexible financing alternative that turns receivables into cash. Instead of having to wait 60 days to get paid, factoring allows you to get paid today, immediately improving cash flow.

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Gibraltar’s Accelerated Invoice Financing Process

Why Gibraltar Invoice Factoring?

Same day funding

Clear, upfront fees; no surprises

Fast, easy approval and funding process

No personal guaranty

The Gibraltar Difference

TYPICAL COMPETITOR

WHY IT MATTERS

PRICING

Pay fees only on funds advanced

Pay fees on full face value of invoices

Transparent pricing - no hidden fees

STRUCTURE

Line of Credit

Invoice by invoice advances

Control daily advance amount and costs

VERIFICATION

Portfolio-based

Invoice-specific

Less disruptive to customer relationships

Free Invoice Factoring Guide

Download our how-to for small and mid-sized business looking to access working capital.

Frequently Asked Questions

The standard advance rate is 85% of the accounts receivable balance. However, at Gibraltar, every advance rate is customized for each client and some may qualify for a higher advance rate.

The advance rate alone does not determine liquidity; it is the starting point. Each factoring company will analyze the creditworthiness and willingness of customers to pay their invoices. The more diversified the customer base, the greater the liquidity provided.

To maximize your liquidity with a factoring company, ask about their credit approval process as well as how they evaluate the willingness of your customers to pay.

Closing time varies by factoring company. Gibraltar takes pride in our ability to react quickly to our customers’ needs. We provide an initial proposal within 24 hours of receipt of the required financial documents. And, our team can close an approved transaction in as few as 5 business days.

It is important to understand every aspect of a pricing proposal. As a customer-focused provider, Gibraltar recommends basing your decision on several factors – not solely on cost. Gibraltar considers what a specific client is looking for and weighs it against the risks associated with the transaction to determine the cost.

As in most financing situations, the less risky the deal, the lower the price. And the reverse is true as well. Regardless of the scenario, Gibraltar is consistently competitive on price. Our team is happy to do price comparisons and calculations upon request.

Gibraltar’s approach to factoring is simple and transparent. Traditionally, factoring companies operate on an invoice-specific basis. That means they look at each individual invoice as a separate transaction, approving and verifying each invoice.

In contrast, Gibraltar pools all of your invoices and creates a “borrowing base” or line of credit of total funding available. After delivering products or services, simply submit invoices for inclusion in the borrowing base calculation. Gibraltar will update the borrowing base availability daily based on new invoices and collections. When you require an advance, fill out the amount you want, sign the borrowing base certificate and submit it to Gibraltar.

Gibraltar is a customer-centric company, and your relationship with your customer is just as important to us as it is to you – we uphold the same integrity of the relationship that you have with your customers. When our team selectively contacts our client’s customers, we confirm that they were satisfied with the delivery of products or services and are willing and able to pay the invoice in the ordinary course of business. Many of our clients do not have back-office staff and internal processes to conduct thorough quality assurance calls, so for many clients, this is an appreciated and valuable business service.

The answer will vary based on the factoring company you work with, but for Gibraltar clients, the short answer is no, you do not. However, there is no compelling reason not to send all invoices to Gibraltar given that you only pay for what you access with our line of credit approach. In fact, sending all invoices is actually a benefit as it 1) provides you with extra liquidity if you ever need it in a pinch, 2) facilitates more collections activity, which will pay your balance down faster, saving you on fees, and 3) is easier to track and manage.

Every situation is unique and customized by client, so which and how many customers we verify will vary. When clients submit the initial batch of invoices for the first funding, Gibraltar sets a credit floor based on the size of the pool of invoices against the individual sums of the invoices. Gibraltar sets the credit floor to capture the top 4 or 5 customers by dollar amount as that is where the concentration of risk lies. Any customer whose balance is below the credit floor gets full credit approval. For customers that are above the floor, we work with you to assign an individual credit limit.

Gibraltar’s line of credit approach provides a distinct advantage for customers. Should an invoice fall out of availability for any reason, businesses may still be “in formula” if you have not accessed the full amount of your availability. In the event you were maxed out when the invoice becomes ineligible, you will most likely be temporarily out of formula. No need to fret! Producing new invoices or receiving collections within the next few days allows businesses to quickly and easily get back within formula.

Minimum of $300K in average accounts receivable balances (outstanding invoices)

Capital needs from $250K to $10MM

Initial financial documents required to establish a relationship with a factoring company may vary slightly, but typically include a summary accounts receivable aging, a summary accounts payable aging, a current balance sheet and a recent profit and loss statement.

Testimonials

“We started working with Gibraltar in 2013 to support our long term growth plans. Within the first few years working together, we grew revenue 8 times with their capital support. As we have grown and faced issues along the way, we’ve felt no need to seek other lender support as our opportunities with Gibraltar always expand to fit our needs.”Kenneth Leonard, CEO, Sunburst Digital

“They were very forthright and responsive, and I found that to be a huge plus to do business with them. I hope to have a very long relationship with GBC.” Steve Golden, Executive Chairman, Moasis